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As the full scope of Europe's proposed tax on financial transactions becomes public, experts are voicing concern that its wide reach will stunt growth. "If you tax the nominal value of derivatives, flow will migrate elsewhere as these contracts can be traded globally," said Diego Valiante of the European Capital Markets Institute. That could lower volume and make European markets less competitive, experts say.

The European Parliament's Economic and Monetary Affairs Committee is leaning toward rejecting draft rules for over-the-counter derivatives, according to Parliament's website. The panel is concerned that the rules would force nonfinancial companies to pass trades through central counterparties, even though the value of such transactions is comparatively insignificant.

AFME said the European Commission should assess the effects of a tax on financial transactions before implementation. "Calls for a financial-transaction tax are being made against the backdrop of several significant new taxes or levies already being introduced by individual member states," said Simon Lewis, CEO of AFME. "Before raising new taxes on the sector, policymakers need to have accurate data about the tax contribution it is already making, to avoid making decisions in the dark."

Michel Barnier, the EU's internal-market commissioner, told the UK's influential Treasury Select Committee that a strong, sustainable financial sector in Britain is desirable but that markets cross borders, making it necessary to regulate at the European and global levels. "My agenda is essentially the [Group of 20] agenda," Barnier said. "It is clear that we can and must do business together." He tried to allay UK concerns that Europe's regulatory policies will be overly intrusive and restrictive.

To ensure the stability of Europe's financial system, officials proposed giving the European Central Bank and the governors of member states' central banks a new oversight role. The European Commission's proposal is based largely on recommendations from a panel led by Jacques de Larosiere, former head of the Bank of France.